Political Broadcasting and Programmatic Buying – Issues to Consider

The week before last, Bobby Baker, the head of the FCC’s Office of Political Programming and the acknowledged guru on political broadcasting issues, and I conducted a webinar for 20 state broadcast associations discussing the FCC rules regarding political advertising and related issues. We have done this seminar every other year for quite some time to help broadcasters prepare for an upcoming election year. Every time we conduct the session, we are faced with some new questions, usually not because the FCC rules have changed, but instead because new advertising practices have arisen in the industry. This year, one of the issues that prompted a question from the audience dealt with “programmatic advertising” – the question being how advertising bought through various programmatic platforms would play into the political broadcasting analysis that each station must conduct to prepare for the political season (including questions of political rates and access rights that might be affected by programmatic sales).

While most of the principles governing the FCC rules on political broadcasting are relatively established (and many are summarized in our Political Broadcasting Guide available here), new advertising practices and opportunities always raise questions as to how those established rules are to be applied. Programmatic buying of advertising time is one of those areas where these questions have arisen in recent years. In the last few years, programmatic buying has become the buzzword in broadcast advertising circles for both radio and TV. It is intended to make ad buying easier and more akin to the experience that ad buyers have when they place online advertising, allowing most of the buying process to take place from the buyer’s computer, anywhere and at any time, often without directly engaging with a station account rep.

While programmatic buying is becoming more and more common in broadcast circles, it is difficult to easily categorize it and describe how it affects a station’s political broadcasting obligations, as what is called “programmatic buying” comes in so many different flavors. Not only does the concept mean different things on different platforms, it is also being provided by all sorts of different companies, from rep firms, to broadcast technology companies, to companies that specialize in specific types of advertising – like remnant ad sales (i.e. sales of unsold advertising inventory on broadcast stations). And some station owners are signing up with multiple providers – sometimes using these multiple platforms for the sale of advertising at the same station. Depending on how the particular platform works, the effect on the station’s political advertising practices, including the lowest unit rates to be charged by the station for political time in the political windows (45 days before the primary and 60 days before the general election), can vary.

The computerized sale of remnant advertising – where the providers of the programmatic buying give advertisers the opportunity to buy left-over advertising on multiple stations so as to reach a total audience in the market in which the stations operate – is akin to systems developed years ago. We wrote about the FCC’s considerations of such remnant advertising platforms many years ago, here. The sales of remnant ads packaged with remnant advertising on other stations tend to raise one set of issues. This kind of advertising – sold in packages, where advertisers are offered delivery of a certain number of advertising impressions in a given market, where that delivery comes from placement of ads on multiple stations – may be the least problematic for individual stations in their political broadcasting compliance.

Because the spots are usually packaged with multiple stations to give the advertiser the number of advertising impressions that they seek in a given market or markets, these ads have no impact on the lowest unit rate on any one station (as ads that are sold in a package on multiple stations do not affect the lowest unit rates on any individual station in the package, although such combination packages on multiple stations must be disclosed and made available to candidates by the company making such combination sales). Moreover, as remnant ads can usually run at almost any time in a broadcaster’s schedule (they are usually not run in fixed programs or at specific times), and are usually very preemptible, the ads are usually in advertising classes not very attractive to candidates who want certainty as to when their ads will run, further minimizing their impact on most station’s political broadcasting sales. But sellers of these packages of remnant advertising may themselves be subject to political rules (as the Commission has traditionally applied such rules to “unwired networks”), so the sellers need to be cognizant of their own political broadcasting obligations.

Other forms of programmatic buying can be more significant for political advertising and need to be carefully tracked by broadcasters. Some of the programmatic systems let advertisers use computerized systems to essentially buy any advertising time that is available in a station’s inventory. Advertisers can in effect have access to a station’s traffic system and schedule their own advertising schedules, and can pick and choose among the rates available to advertisers in a station’s traffic systems. It’s this ability to pick and choose what the advertiser wants that could raise political broadcasting issues. If the programmatic deals allow discounts off of a station’s rates for specific classes of time, either simply because they are booked through the programmatic system or because of the volume of spots bought by the advertiser, these discounts could affect the lowest unit rates of the stations in the classes of time bought by the advertiser using the programmatic system.

The ability of any advertiser to get access to the station’s ad schedule to schedule their own ads toward the end of an election season could also affect a station’s ability to squeeze in political ads as necessary to meet reasonable access and equal opportunities obligations. A commercial advertiser using a programmatic platform to place a big advertising buy scheduled to run in the last days before an election could disrupt the ability of a station to make time available to candidates that the station is obligated to provide because of equal opportunity and reasonable access requirements. And, if political advertisers themselves use the programmatic systems to buy and schedule advertising, all sorts of issues could arise, especially to the extent that such ads are bought with higher protection levels where they preempt political ads, or simply because they have other impacts on political schedules that stations need to be tracking.

The contracts and practices of providers of programmatic advertising need to be carefully reviewed to assess the potential for issues to arise in a political broadcasting context. If the programmatic network is used by political and issue advertisers, stations need to be sure that they are getting timely notice of the ad buys, and all the necessary paperwork about the buyer, so that the station can meet its political file obligations. As disclosures of political ad buys often require more information than that is received from the typical ad buyer (especially for third-party political ad buyers from whom information about their principal officer and directors is required, as is the identification of the political issue being addressed), the systems must be able to provide that information.

Generally, programmatic platforms should also be reviewed so that buys made through the system otherwise comply with all other station legal obligations that, once upon a time in the distant past when broadcasters used printed contracts, would have been expressed in the terms and conditions for sales which were often printed on the back of the sales contracts. We have written about the issues that can arise from the demise of the printed advertising contract. See for instance our article, here, where these issues were discussed in the context of the required FCC advertising non-discrimination certification, which also needs to be worked into the programmatic buying process.

We’ve worked with some providers of programmatic systems to help design their systems so that stations that use them can assure that their inventory can be controlled during the election season, and we have looked at agreements from providers for broadcast station clients. These are not simple deals that can be entered into without thought. Any broadcaster using any programmatic buying system needs to carefully review the system that they are using, and determine if there are any potential political broadcasting issues – and to assure that the contracts with the providers give stations the rights that they need to assure compliance with political broadcasting rules (and other FCC obligations).

As these programs and platforms can each pose their own issues, stations should consult with their communications counsel on how any program may impact their political obligations. The FCC’s Office of Political Programming, who gave me their thoughts on these issues as I was writing this article, are also very willing to discuss the issues, and are quite helpful in walking through the implications of any sales platform. Make sure that you understand the implications as you use these programs. This is certainly true for the upcoming busy 2018 election year and, with issue advertising becoming more and more a part of the broadcast landscape even outside of election years, these considerations can arise at any time. So look carefully at the legal issues that can arise from any programmatic ad platform.

David Oxenford represents broadcasting and digital media companies in connection with regulatory, transactional and intellectual property issues. He has represented broadcasters and webcasters before the…

David Oxenford represents broadcasting and digital media companies in connection with regulatory, transactional and intellectual property issues. He has represented broadcasters and webcasters before the Federal Communications Commission, the Copyright Royalty Board, courts and other government agencies for over 30 years.

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David is a partner at the law firm of Wilkinson Barker Knauer LLP, practicing out of its Washington, DC office. He has represented broadcasters for over 30 years on a wide array of matters from the negotiation and structuring of station purchase and sale agreements to regulatory matters. His regulatory expertise includes all areas of broadcast law including the FCC’s multiple ownership limitations, the political broadcasting rules, EEO policy, advertising issues, and other programming matters and FCC technical rules.